JAL Says PAL Closure Could Boost Revenues

The Business Daily
Monday, September 21, 1998

HONGKONG — Japan Airlines Co_ Ltd. (JAL) said last week its revenues may receive a boost if Philippine Airlines Inc. (PAL) closes down.

"That could have a positive effect on our revenue earnings," JAL Spokesman Geoffrey Tudor told Reuters.

“We are quite prepared to put on more flights to meet demand as a results of PAL's closure because there may be a need to do tha,." he said.

PAL said on Thursday its board had approved the closure of the airline at midnight on Sept. 23 after a union rejected the management's equity offer.

JAL said traffic between Japan and Manila was currently quite strong.

The Japanese carrier already planned to increase its flight frequency between Tokyo and Manila to 12 weekly flights from 10 with the introduction of its winter schedule, starting at the end of October.

JAL also operates four weekly flights between Nagoya and Manila.

PAL said it offers daily flights between Manila and Tokyo and three weekly flights between Cebu and Tokyo.

A shutdown of PAL could, however, have a negative impact on JAL's revenues.

The two carriers have a reciprocal ground handling agreement where JAL provides PAL with passenger and cargo handling and basic aircraft servicing at Narita airport.

"If they are going to stop flying here then we'll lose that business," said Tudor, but added:

"We think that we should be able to recoup any losses there from additional revenue."

JAL said it had received assurances that the Airport Services Department in Manila would continue to provide ground handling service for JAL and other customers after Sept. 23.

"We understand that they will be continuing to provide ground handling for us and their other customers, possibly under a new company name," Tudor said. — Reuters